Oil production reaches 40,500 barrels per day
Daily oil production reached new record levels of 40,500 barrels per day by the
end of the fourth quarter 2007. Total fourth quarter oil production increased by
27% to 3,130,588 barrels (2,472,980 barrels) and the average daily production
for the quarter increased to 34,028 barrels per day (26,880 barrels per day).
Total oil production for 2007 increased by 33% to 10,637,650 barrels (8,010,855
barrels). For 2008, total oil production is projected to increase to 15 million
barrels.
Oil production was established at the Kolvinskoye field in the Timano Pechora
region in accordance with license obligations.
Average gross oil prices received in the fourth quarter 2007 increased to
approximately USD 54 per barrel from USD 46 received in the third quarter 2007.
The increase in gross prices resulted in average fourth quarter netbacks, after
transportation costs, preliminarily improving to USD 39.40 per barrel from USD
33.55 in the third quarter.
Tomsk region
Total oil production in the Tomsk region for the fourth quarter 2007 was
1,032,694 bbl (818,635 bbl).
Development started at the Khvoinoye field where one oil production well and one
water production well were drilled. These wells are scheduled to be operational
in the beginning of 2008. In January, 3 wells in the Puglalymskoye field and 4
wells in the Kluchevskoye field will be subject to hydrofraccing activities
intended to increase flow rates.
A pressure support system was put into operation in the Kluchevskoye field where
preparation of new drilling pads for this years' drilling program started. The
construction of a 52 km winter road to the Middle-Nyurola field was finished in
order to secure the supply of equipment and materials for the 2008 working
program.
Timano-Pechora region
Total Timano-Pechora region oil production for the fourth quarter 2007 increased
to 1,139,620 bbl (714,505 bbl).
At the Kolvinskoye field, the first 322 barrels of oil were extracted from well
number 66 which was reactivated in order to test well productivity and meet
license obligations. In the field, infrastructure for future drilling and
production is being developed, including oil separation and treatment units, 4
drilling pads, transportation and energy supply systems. A winter road is under
construction.
A new geological model of the Lek Kharyaga field was created following the
interpretation of 70 km2 of 3D seismic data. 2 new wells were drilled and
completed in the field with higher than expected flow rates of 1,500-1,700
barrels per day. The flow rate from well number 415 more than doubled to 1,600
barrels per day after the installation of a higher capacity electronic
submersible pump. An 8.3 kilometer winter road was constructed to the field.
At the Middle Kharyaga field, construction of water and heating supply systems
for the treatment facility was completed. Also, the construction of a 10.5
kilometer winter road to the field was finished to facilitate the supply of
equipment and materials for the 2008 working program.
At the North Kharyaga field, the interpretation of a 120 km2 3D seismic study
was completed and a new geological model of the reservoir was created. 3 new
producing wells were drilled and 4 wells were put into operation in the field.
In order to improve flow rates from new wells that have been underperforming,
studies have been initiated to determine appropriate technology for formation
opening and choice of drilling mud.
Volga-Urals region
Total Volga-Urals oil production for the third quarter amounted to 958,274 bbl
(939,840 bbl).
The upgrade of the Kochevnenskoye field's oil treatment facility was completed
increasing capacity to 10,800 barrels per day. This allowed production to start
from the previously drilled wells number 111 and 112. Well number 2 was
sidetracked and will be put on production in January 2008.
At the Novo Kievskoye oil field, drilling of a production well started. This
well is intended to optimize the field reserve recovery.
Drilling of the first exploration well started at the Ivanikhinskaya structure.
The objective of the exploration tests is to confirm potential oil resources of
4.1 million barrels according to external estimates.
A new 25 year oil production license for the Kovalevskoye field was obtained.
“Our exploration and development efforts resulted in production and reserve
increases in all regions. In 2007, 100% of our growth was organic” Maxim Barski,
West Siberian's managing director stated and added: “For 2008, we are planning
to increase production by more than 40% from our existing assets. We have also
extracted the first barrels of oil from the Kolvinskoye field where we plan
significant investments and oil production in the years to come.”
For further information:
Maxim Barski, Managing director, West Siberian Resources Ltd., tel. +7 495 956
48 82
Eric Forss, Chairman, West Siberian Resources Ltd., tel. +46 70 523 86 62
Also visit www.westsiberian.com
West Siberian Resources Ltd is an independent oil company active in Russia. West
Siberian´s depository receipts are traded at the Stockholm Stock Exchange's
Nordic list under the symbol WSIB.
